Nn Gives Tax Break To Big Business

January 24, 1996|By AMY GARDNER Daily Press

NEWPORT NEWS — The Newport News City Council on Tuesday gave a break on the Business, Professional and Occupational License tax to high-revenue companies doing business in the city, including MCI and UPS.

Starting with the tax bills due March 1, retail businesses will pay according to a two-tier tax scale that charges 20 cents per $100 of gross receipts for the first $50 million in revenue and 5 cents per $100 for any revenue beyond that.

Another category of businesses - those that provide repair, personal or business services - also will pay according to a new, two-tiered tax schedule. The rate for gross receipts up to $5 million will now be 36 cents per $100 for these businesses; for revenue beyond that, the rate will again drop to 5 cents per $100.

The new schedule should reduce the city's BPOL revenue by no more than about $90,000, Commissioner of the Revenue Charles Crowson said Tuesday. No retail businesses now in the city will be affected by the change, and just nine businesses in the second category are affected.

The purpose of the adjustment, Crowson added, is to improve the city's ability to attract high-volume service businesses, such as recent arrivals MCI and United Parcel Service center.

Both of those businesses agreed to set up shop in Newport News with the understanding that the city would try to lower the BPOL rate for the top portion of their revenue, said Paul Miller, the city's director of planning and development.

"It's a relatively new thing that we have telemarketing in our city, and the rate structure for BPOL was uniform," Miller said. "To compete, we needed to go up to two tiers."

Tuesday's revision is separate from efforts in the General Assembly to lower the amount of BPOL tax cities and counties may collect from businesses, Crowson said.

Newport News expects to collect about $8.5 million in BPOL revenue this fiscal year. One proposal being considered in Richmond would reduce that amount by about $225,000, Crowson said.